The best way to buy final expense insurance, otherwise referred to as burial insurance is through an insurance agent. An agent can walk you through all of the things you need to consider when purchasing a plan. They are also familiar with the reputations of each company and can help you choose the company that will benefit you most in the end. Beyond working with an agent, it is helpful for you to be aware of the different insurance companies and their advantages and disadvantages. Read more below to understand more about the buying process for burial insurance.
The Definition of Burial Insurance
Burial insurance is a type of life insurance policy. Unlike traditional life insurance, burial insurance is a smaller policy. It is more affordable with lower monthly premiums. In exchange, its face amount is smaller. The maximum amount of coverage offered by final expense insurance is $50,000. While it is intended to cover costs associated with end-of-life, like funerals or outstanding debt, recipients can choose to use the money however they wish.
The Difference Between Burial Insurance and Life Insurance
Burial insurance is a type of life insurance. It offers less coverage for cheaper monthly payments. While it is typically used to cover end-of-life expenses, it can be used for anything beneficiaries wish. Because it is a type of life insurance, it is unnecessary to buy both burial insurance and life insurance.
Who Should Consider Final Expense/Burial Insurance
Final expense insurance is an excellent option for many consumers, but it may not meet all consumers’ needs. Final expense insurance is best for people who do not qualify for traditional life insurance because of their age or medical problems. Additionally, final expense insurance is an affordable option for people who cannot afford traditional life insurance. If you can afford traditional life insurance, many experts recommend purchasing it is as it is more robust than final expense insurance.
Best Insurance Companies for Final Expense Policies
The insurance companies below offer quality policies that apply to most people. These companies are rated by multiple rating companies. A.M. Best provides the scores given here. They consider many different factors when scoring these insurance carriers, such as history paying claims and other financial obligations.
The best insurance companies for consumers looking for final expense insurance are, in no particular order:
- Mutual of Omaha
- Foresters Financial
- Trans America
- Royal Neighbors of America
- American Amicable
- AIG
- Americo
- Gerber Life
Each company is explored in more detail so that you can understand which one is right for you.
Mutual of Omaha
A.M. Best Rating: A+
New Applicant Range: 45-85
Face Amount Options: $2,000-$40,000
Pros:
- No waiting period
- Low monthly rates
- Flexible options
- Accept some chronic diseases
Cons:
- Do not accept all serious diseases
Foresters Financial
A.M. Best Rating: A
New Applicant Range: 50-85
Face Amount Options: $2,000-$35,000
Pros:
- No waiting period
- Low monthly premiums
- Flexible Plans
- Offer plans to people with mental health issues
Cons:
- Modified plan is not a good value
TransAmerica
A.M. Best Rating: A+
New Applicant Range: 45-85
Face Amount Options: $1,000-$50,000
Policy Type: whole life insurance
Waiting Period: No
Pros:
- No waiting period
- Very large age range
- Very large coverage range
- Great for people with COPD
Cons:
- No major stand-out cons
Royal Neighbors of America
A.M. Best Rating: A-
New Applicant Range: 50-85
Face Amount Options: $5,000-$25,000
Pros:
- No waiting period
- Flexible plans
- Low monthly premiums
- Best for seniors with diabetes
- Good for people with other serious issues
Cons:
- Does not offer guaranteed acceptance plans
American Amicable
Prosperity Life Insurance Group
A.M. Best Rating: A
New Applicant Range: 50-85
Face Amount Options: $2,500-$35,000
Pros:
- No waiting period
- Includes people with serious mental health disorders
- Good premiums for tobacco users
- Does not include cigar or pipe users as tobacco users in its algorithm
Cons:
- Smaller range of coverage
AIG
A.M. Best Rating: A+
New Applicant Range: 50-85
Face Amount Options: $5,000-$25,000
Pros:
- Guaranteed acceptance
- Lower monthly premium that other guaranteed plans
Cons:
- 2-year waiting period – typical for guaranteed plans
- Smaller coverage range
Americo
A.M. Best Rating: A
New Applicant Range: 50-85
Face Amount Options: $2,000-$30,000
Pros:
- No waiting period
- Asks very few medical questions
- Accepts people with many serious conditions
Cons:
- Smaller range of coverage
Gerber Life Insurance
A.M. Best Rating: A
New Applicant Range: $5,000-$25,000
Face Amount Options: 50-80
Pros:
- Guaranteed acceptance plan
- High interest rate with refund
Cons:
- 2-year waiting period – typical for many guaranteed plans
- Smaller range of coverage
As stated above, insurance agents are the most familiar with these companies and can help you navigate the differences between the plans.
How to Purchase Burial Insurance
The first step in purchasing final expense insurance is doing your research. You need to reflect on your life and needs and write down the considerations you should consider when purchasing a plan. Then, you can research which companies and policy types are best for you. If you have a financial advisor, this may be the best time to schedule a conversation.
After you have done your research, you should choose an insurance agency to help you shop for the plans. It is best to have an insurance agent because they are most familiar with the plans and companies. Then, you can choose your beneficiaries for final expense insurance.
While you can leave them instructions for how you believe your death benefits should be spent, your beneficiaries ultimately have the freedom to do as they wish. You cannot miss payments, or your beneficiaries will not receive benefits.
Key Takeaways
The above insurance carriers are reputable companies that offer excellent plans for a wide variety of people. You first need to understand your own financial and medical needs. After you understand your needs, you should research to understand the market better. After you have a basic understanding, you should talk to an insurance agent like the ones at Wise Up Financial. We can help you understand the differences in the plans and what you need to look for.
